Verizon finds $1bn more for MCI
Still can't match Qwest
MCI likes the look of a new $7.6bn acquisition bid from Verizon even though the deal is almost $1bn less than the more flirtatious Qwest Communications has offered.
Verizon hiked the amount of cash it will pay MCI shareholders and added in provisions to its bid that would protect investors against a drop in Verizon's stock. The new deal is well above the $6.7bn offer Verizon had once put on the table but below the $8.5bn offer from Qwest.
"MCI’s Board has been closely and carefully evaluating all of the recent developments," said Nicholas deB. Katzenbach, MCI's Chairman. "We believe Verizon’s substantial increase in its offer, the strength of its competitive position and the financial certainty at close make this offer compelling to our shareholders, customers and employees."
MCI does seem quite committed to Verizon at this point. It has agreed to pay up to a $240m termination fee should the deal fall through.
Qwest has put a 5 April deadline on its bid for MCI. The company is hoping MCI shareholders will pick its cash over what MCI management sees as Verizon's substance. ®
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